DMA’s Quarterly Business Review Finds Modest Improvement

NEW YORK—March 11, 2011—The Direct Marketing Association (DMA) released its Quarterly Business Review (QBR) for the fourth quarter of 2010. DMA partnered with Winterberry Group, a leading strategic management consulting firm that helps advertising and marketing companies build shareholder value, on this report.

In Q4 2010, the marketing and advertising community continued with modest, but steady, improvement in all key economic performance measures. Revenues, investment, staffing levels and bottom-line profitability all rose from the previous quarter.

“Once again, digital media received the bulk of new investment, with e-mail and social media leading the way,” said Yoram Wurmser, director of marketing and media insights for DMA. “That said, marketers reported increased spending in every medium we track. This points to a broad-based recovery in the marketing industry.”

“The main conclusion we can derive from the fourth quarter data really has little to do with holiday-season spending or marketers’ preparation for this new year,” said Jonathan Margulies, a vice president at Winterberry Group. “Instead, the continuing acceleration of marketing investment and payback represent a capstone achievement for an industry that faced crisis conditions no more than 15 months ago. To wrap up a year that brought great economic improvement with yet more signs of optimism portends good things ahead for marketers and the supplier community in 2011.”

Key findings include:

• A majority (54.7 percent) of marketers reported an increase in revenue generated from direct/digital marketing activity compared with the same quarter last year (SQLY).

• Marketers and suppliers are optimistic about their near-term profitability, with a majority of marketers (53.5 percent) and nearly half of suppliers (46.1 percent) projecting improved performance during the first quarter of 2011.

• Marketers reported “general demand for digital marketing investment/activity” as the most significant driver of marketing investment in Q4, in contrast to previous quarters, when the leading answer was “availability of improved data analytics tools and processes.”

• Despite the overall positive performance by marketers, job growth remains slow—67.1 percent of marketers and 51.7 percent of suppliers, respectively, indicated that their staffing levels remained unchanged during the fourth quarter as compared to the previous quarter (Q3 2010).

• Digital channels, led by search, social and mobile, had the largest increases in ROI in Q4.

About DMA’s Quarterly Business ReviewDMA’s Quarterly Business Review (QBR) for the fourth quarter of 2010 is based on two online surveys conducted by DMA’s Research and Market Intelligence department in January 2011. Altogether DMA received 665 usable survey responses.

The report is free for DMA members. Non-members can purchase a copy for $49.95 from DMA’s Bookstore by clicking here.